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Viet Nam looks to take advantage of Japan trade treaty
Vietnamese businesses will continue to capitalise on a trade deal with Japan that took effect last year to boost exports to that market, business leaders predict.
Since the Viet Nam-Japan Economic Partnership Agreement came into effect in June 2009, reducing and eliminating tariffs on Vietnamese goods, seafood, textile and garment, and vegetable exports have been robust.
The Viet Nam Seafood Export and Processing Association said the tariff reduction has increased the competitiveness of Vietnamese products compared to those from other countries in the region.
Le Van Quang, General Director of Minh Phu Seafood Joint Stock Company, said Japan did not buy much shrimp from Viet Nam in the past owing to high prices, preferring to import shrimp from Thailand and Indonesia.
But the tariff cuts have changed all that.
Japan is now Viet Nam's largest buyer of frozen shrimp, with imports of US$400 million last year, or almost 30 per cent of all the shrimp the country exports.
In the first two months of this year, seafood exports to Japan were worth $89.7 million, 11.6 per cent higher year on year.
Vegetable exports to Japan have surged since the end of last year, with many Japanese importers seeking the Viet Nam Vegetable Association's assistance to find sellers who can supply thousands of tonnes each month.
Huynh Quang Dau, Director of An Giang Agricultural Technical Service Co, said so far this year, his company's exports of taro, peas, and violet sweet potato have increased 30 per cent over the same period last year.
Vegetable exporters are very confident thanks to the impact of not only the tax cuts but also global economic recovery.
Japan is the third largest buyer of Vietnamese vegetables after only China and Russia.
The textile and garment sector is also stepping up exports to Japan.
Sai Gon 3 Joint Stock Company said it has signed contracts worth $50 million to export 6 million pieces to that country.
Pham Xuan Hong, the company's Chairman, said Japanese orders are up 20 per cent over last year.
Under the trade agreement, Vietnamese textile and garments can enter Japan tariff-free. The tax rate used to be 10 per cent until the treaty took effect.
"Opportunities are huge if businesses choose the right partners," Xuan said.
Diep Thanh Kiet, Chairman of the HCM City Garments, Textiles, Embroidery and Knitting Association, said young Japanese consumers prefer fashionable products and diverse designs.
The Viet Nam Textile and Garment Association said it recently joined an ASEAN project that seeks to establish close links among the member-countries' textile and garment industries and promote exports.
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